Gaon Chips’ ₩9.8B Contract: What Happened?

On September 16, 2025, Gaon Chips announced a new contract for Application-Specific Integrated Circuit (ASIC) design and development, valued at ₩9.8 billion. The client remains undisclosed, and the contract period runs from September 15, 2025, to June 30, 2027. This represents 10.11% of Gaon Chips’ 2024 revenue and is expected to significantly impact future performance.

The Significance of the Contract: Why Does It Matter?

This contract is a crucial indicator of Gaon Chips’ growth potential. Focusing on high-value-added markets such as AI, HPC, and Automotive, Gaon Chips has strengthened its advanced process design capabilities through close collaboration with Samsung Foundry. This new contract is a testament to these efforts. Following previous contracts with companies A and B, this additional win demonstrates Gaon Chips’ robust order pipeline.

Impact and Outlook: What’s Next?

  • Revenue Growth: The contract is expected to contribute to steady revenue growth over the next year and nine months.
  • Profitability: While good profitability is expected due to the high-value-added nature of the service, cost management will be crucial considering the increasing trend in R&D expenses.
  • Stock Price Impact: The contract is likely to provide positive momentum in the short term. Long-term impact will depend on securing further contracts.
  • Risk Factors: Continuous monitoring of external factors like global economic volatility, semiconductor market conditions, and exchange rate fluctuations is necessary.

Key Takeaways for Investors

This contract offers a valuable opportunity to assess Gaon Chips’ growth prospects. Investors should consider the client information (when disclosed) and further market analysis when making investment decisions.